GROUP 4 QUESTIONS

What are the exceptions to the rule of sale by a person who is not the owner of the thing
sold.
Suggested answer:
1. When the sale is made under authority or with the consent of the owner.
2. When the owner is precluded by his conduct from denying the seller’s authority to sell.
3. Where the law enables the apparent owner to dispose of the goods as if he were the true owner
thereof.
4. When the sale is sanctioned by statutory or judicial authority.
5. When the sale is made in a merchant’s store, or in fairs, or markets.

What is the difference between “Sale or return” and “Sale on approval or on trial or
satisfaction”
Suggested answer:
1. In sale or return, ownership of the goods passes to the buyer upon delivery. In sale or
approval, ownership passes to the buyer upon his acceptance of the goods or expiration of the
time given to him to signify his acceptance
2. In sale or return, the risk of loss is on the buyer, in sale on approval, the risk of loss is on the
seller
3. In sale or return the buyer may return the goods even if he is satisfied of it’s quality. In sale on
approval the buyer has no right to return the goods if he is satisfied of its quality

Instances when the ownership of specific goods is retained by the seller despite the delivery
to carrier or other bailee
Suggested answer:
1.) When there is a stipulation to that effect
2.) When by the terms of the bill of lading, the goods are to be delivered to the seller or his agent
or to the order of the seller or his agent
3.) When by the terms of the bill of lading, the goods are deliverable to the buyer or his agent,
but the bill of lading is retained by the seller or his agent
4.)When the seller draws on the buyer a bill of exchange for the prices and transmits the bill of
lading and the bill of exchange to the buyer to secure acceptance or payment of the bill of
exchange but the buyer dishonors such bill of exchange
In case the seller of goods has a voidable title thereto, what are the requisites for
acquisition of good title by the buyer?
Suggested answer:
(1) the seller's voidable title is yet to be avoided
(2) buyer buys in good faith and for value
(3) buyer has no notice of the seller's defect of title.

Up to where does the seller bear the risk of the thing being lost when it is shipped to the
buyer?
Suggested Answers:
(a) In FOB Shipping Point the seller bears the risk only up to the place of shipment (carrier)
designated in the contract.
(b) In FOB Destination, the seller bears the risk until the thing arrives to the destination placed
in the contract.
(c) In FAS (free alongside) (named vessel), the seller bears the risk until the thing is delivered
alongside the named vessel or at a dock designated.
(d) In CIF (cost, insurance, freight) (named destination), the risk of loss borne by the seller is up
until the shipping point only despite the word “destination” is used. [The seller quotes the lump-
sum(Cost+Insurance+Freight) price to the buyer.]
(e) In C and F, the same as CIF except Insurance is not included.
(f) In Ex-Ship, the seller is responsible up until the thing is unloaded from the Ship.
(g) In Ex (point of origin), seller bears the risk of loss until such time that the buyer is obliged to
make delivery of the goods.
(h) In Ex Dock (named port of importation), the seller bears the risk of loss until the expiration
of the free time within which the goods are allowed on the dock at the place of importation.
Who bears the risk of loss of the thing sold after perfection of the contract but before
delivery?
Suggested answer`
There are two views in case of risk of loss of the thing sold after perfection of the contract but
before delivery
1st view: Under the Roman law rule, title passes to the buyer from the perfection of the contract
hence the risk of the thing passes to the buyer even though the thing has not yet been delivered to
him. Thus, the buyer must still pay the price of the thing lost. This view is supported by the
argument that from the perfection of the contract, the fruits of the thing sold shall pertain to the
buyer (Article 1537) and any benefit accruing on the thing before delivery inures to him. Hence,
it is only fair that the buyer shall bear the loss or any injury on the thing occurring before
delivery.
2nd view: Under the res perit domino principle, the loss of the property falls upon the owner and
in the contract of sale ownership passes to the buyer upon delivery. Hence, before delivery,
ownership remains with the vendor therefore he must bear the loss. Thus, the buyer is not
required to pay the price. This view is more logical according to eminent jurist Arturo Tolentino.